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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Bulgarian Prop. | LSE:BPD | London | Ordinary Share | GB00B058TT05 | ORD 25P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 16.50 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:4728T Bulgarian Property DevelopmentsPLC 22 March 2007 FOR RELEASE 7.00AM 22 MARCH 2007 BULGARIAN PROPERTY DEVELOPMENTS PLC ("the Group") (The Group is primarily focussed on the development of commercial property and in particular building pre-let warehousing, distribution centres and offices) REVIEWED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2006 Main points * Turnover, including joint ventures, of #91,000 * Loss before tax #320,000 * Loss per share 0.46p * Building works have commenced at Varna Logistics Centre * Value of land portfolio has increased by 48% over cost as at February 2007 * Equity raised in February effectively fully invested * Purchase of a 87,000 square metres (21.5acres) site near Lozenets in Sofia, for the Sofia Commercial Centre, completed after the period end in February 2007. Enquiries: Bulgarian Property Developments Ivo Hesmondhalgh (Joint Chief Executive) +44 (0) 20 7243 1336 Philip Pashov (Joint Chief Executive) + 359 2 8199 205 Matrix Corporate Capital Limited Ken Vere Nicoll +44 (0) 20 7925 3300 Fairfax I.S. Limited James King +44 (0) 20 7598 5368 Cubitt Consulting Brian Coleman-Smith / Allison Reid / Leanne Denman +44 (0) 20 7367 5100 BULGARIAN PROPERTY DEVELOPMENTS PLC INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2006 CHAIRMAN'S STATEMENT The most significant step for the Group since the announcement of results for the year ended June 2006 has been the purchase of 21.5 acres or approximately 87,000 square metres ('sm') near Lozenets, one of the better residential areas of Sofia. The purchase took place on 1st February 2007 so is not reflected in the Group's interim results. I have set out greater details of this site and the Directors' intentions for it later on in this statement. This acquisition means that the Group is effectively fully invested. The other main noteworthy event over the course of the last six months is that Bulgaria has joined the European Union. Whilst this was widely predicted, Bulgaria's accession should guarantee the county's political stability and further stimulate the growth of its economy. The EU has promised a wide range of grants to Bulgaria and many of these are aimed at improving the infrastructure of the country. The results for the six months to 31st December 2006 show a loss before tax of #320,000. The directors do not propose to declare a dividend. I have set out below the current status of the Group's main sites. Sofia Airport Sites Although it has taken longer than anticipated, progress has been made towards obtaining planning permission for the Group's sites in the area around the airport. The Group's advisers are now confident that rezoning will be achieved imminently. Colliers have valued the sites at Euro3,356,000 against current costs of Euro2,188,000. Sofia Ring Road Sites The Group has two main sites on the western ring road. The Group exchanged contracts for the sale of one of these sites in October 2005, subject to rezoning being achieved. Rezoning for this site has now been granted and notice to complete has been served on the purchaser. Completion is due to take place in early April and will produce a profit, before tax, of approximately Euro370,000 for the Group. Rezoning of the other site has been slower than anticipated, mainly due to the preparation of the Sofia development master-plan. Following the rezoning of the Group's other site (mentioned above) which is immediately opposite, on the other side of the ring road, the Group is now optimistic that rezoning will be achieved for this site, although it may take several months. Sofia Commercial Centre As I mentioned at the beginning of my statement, the Group has completed the purchase of an 87,000 sm site adjacent to Lozenets in Sofia which is approximately halfway between the southern section of the Sofia ring road and the city centre and is adjacent to the proposed Sofia inner city ring road. Your directors understand that the construction of the inner city ring road is one of the main priorities of the Sofia municipality. The site has full commercial zoning and lends itself to a mixed development of offices and retail. Approximately one third of the site is vacant and the remaining two thirds consists of run down offices and warehousing, which are rented out and produce a yield in the region of 3% per annum on the purchase cost. The Group intends to apply for a greater density development than exists at present. Once this is achieved, it intends to first develop the vacant part and, when the new buildings are occupied and income producing, to develop the rest of the site. The Group anticipates being able to start building works in 2008. Plovdiv - Trakia Retail Centre As I reported on 29 July 2006 the Group, in a 50/50 joint venture with Fairplay International AD, completed the purchase of a 21,800 sm land plot in the Trakia district of Plovdiv (Bulgaria's second biggest city) at a price for the site of Euro4,431,000. Following a feasibility study completed by Colliers International, it is intended that it should be developed as a retail centre and the directors are actively seeking an anchor tenant. Varna Logistics Park On 4 October 2006 the Group purchased 50% of the shares of Varna Logistics AD for Euro6,366,000, the other 50% of the shares being purchased simultaneously by Fairplay International AD at the same price. The sole asset of Varna Logistics AD is a 132,500 sm income producing industrial site in the city of Varna, which is on the Black Sea and is the third largest city in Bulgaria. Approximately one third of the site is vacant. The rest of the site has a number of run down industrial buildings on it. These are tenanted and produce a net return of 5.3 per cent per annum. A master-plan has been prepared, showing a mixed development of warehousing, medium grade offices, retail (on the road frontage) and a supermarket. The plan envisages development being conducted in phases, with Phase One being the development of the vacant portion of the site. Once completed Phase One will have two warehouses (each of approximately 5,000 sm) together with associated offices, a multi storey car park and a parade of shops with offices above. Initial building works on this part of the site have just begun. The existing run down buildings remain occupied and should not be affected by the Phase One building works. Once the new buildings are occupied and let, it is intended to redevelop the rest of the property. This phased approach should mean that there should always be an income stream to help service any debt. Pleven Retail Park The Group is part of a consortium that purchased a plot of 36,500 sm from the municipality of Pleven in October 2006 for a total cost of Euro1,595,000. The Group has a 38% share of the consortium. Pleven is a busy town of 120,000 inhabitants in the north of Bulgaria. The site already has planning permission for retail use. A master-plan has been prepared and Colliers International have produced a feasibility study for the site. The consortium is actively seeking anchor tenants and once at least one anchor tenant has been signed up, the consortium will commence development. Values The Directors have instructed Colliers International to carry out a valuation of all of its principal properties. The table below sets out the result of these valuations. The completion of the purchase of the Sofia Commercial Centre only happened in February 2007 and it has, therefore, been shown at cost. In a few other cases involving small plots of land, the Directors have not asked Colliers to value them and these have also been shown at cost. Property Area Date of Value Uplift Value Uplift Value % (sm) Purchase Un-zoned on Feb on cost Feb (note Cost cost 2007 (%) 2007 Uplift 6) Euro's (%) Rezoned Rezoned Euro's on Cost (note 2) Euro's (note 2) Feb 2007 Varna 66,250 13.10.06 6,717 N/A N/A 8,002 19.1 8,002 19.1 (50%) Plovdiv 10,915 31.07.06 2,296 N/A N/A 3,378 47.1 3,378 47.1 (50%) Pleven 13,876 11.10.06 606 N/A N/A 736 21.4 736 21.4 (38%) Sofia Ring 92,510 2004-2006 2,171 4,688 117.8 7,272 235 4,688 117.8 Road One Sofia Ring 19,649 13.12.04 395 N/A N/A 786 98.9 786 98.9 Road Two (note 3) Misc small 42,740 2004-2006 1,077 1,529 41.9 2,087 93.8 1,529 42.0 sites (note 4) Airport 22,951 2005 1,264 2,075 64.2 3,080 143.7 2,075 64.2 Site 1 Airport 14,900 2005 924 1,281 38.6 1,869 102.3 1,281 38.6 Site 2 Bansko 6,094 13.04.05 506 N/A N/A 1,082 63.7 1,082 63.7 SUB TOTAL Pre 31 15,956 23,557 47.6 Dec 2006 Sofia 87,003 01.02.07 24,836 N/A N/A N/A N/A 24,836 0 Commercial Centre TOTAL 376,888 40,792 N/A N/A N/A N/A 48,393 1. All valuations carried out by Colliers International. 2. The value or cost shown is the value or cost of BPD's % of site as appropriate. 3. Contracts for sale of Ring Road Site Two exchanged. Completion notice served on purchaser. Value shown is sale price. 4. Colliers have not valued all of these plots. Where they have not valued them, the total cost to date is shown as their value. 5. Figures are in Euro's and shown in thousands. 6. Area shown is BPD % of site not total area of site. 7. 31 December 2006 exchange rate: #1 : Euro1.4852. All the Group's properties are held as trading assets and, in accordance with the Group's accounting policies, such assets are not revalued in its accounts. Adjusting for the rezoned revaluation surplus shown by Colliers' valuation and equivalent to 6.9p per share, the Group's NAV per share as at 31 December 2006 would have been equivalent to 57.03p per share. Your board looks forward to continued progress and is optimistic as to the prospects of your Group in the years ahead. Christian Williams Chairman Bulgarian Property Developments Plc Consolidated Profit and Loss Account for the six months ending 31 December 2006 Unaudited 6 month Audited period year ended 31 ended 30 December June 2005 Unaudited 6 month period ended 31 2006 December 2006 Group Interests Total Group Group in joint ventures #'000 #'000 #'000 #'000 #'000 Turnover - 91 91 - 2 Cost of sales - - - - - Gross profit - 91 91 - 2 Administrative expenses (832) (33) (865) (633) (186) Operating profit/(loss) (832) 58 (774) (633) (184) Share of operating profit in Joint ventures 58 - - Total operating loss: (774) (633) (184) Group and share of joint ventures Interest receivable: Group 495 671 19 Joint ventures - - - 495 671 19 Interest payable: Group - - - Joint ventures (41) - - (41) - - Profit/(loss) on ordinary activities before tax (320) 38 (165) Tax on profit/(loss) on * ordinary activities (15) (103) - Retained loss for the period (335) (65) (165) Loss per share (0.46p) (0.17p) (2p) * Tax relates to the following: Parent and subsidiaries (7) Joint ventures (8) Bulgarian Property Developments Plc Consolidated Statement of Total Recognised Gains and Losses for the six months ending 31 December 2006 Unaudited 6 month Audited period year ended 31 ended 30 December June 2005 Unaudited 6 month period ended 31 2006 December 2006 Group Interests Total Group Group in joint ventures #'000 #'000 #'000 #'000 #'000 Loss on ordinary activities after taxation (335) (65) (165) Currency translation differences on foreign currency net investments 11 (6) (20) Total recognised gains and losses for the period (324) (71) (185) Bulgarian Property Developments Plc Consolidated Balance Sheet 30 31 June December 31 December 2006 2006 2005 Group Interests Total Group Group in joint ventures #'000 #'000 #'000 #'000 #'000 Fixed assets Tangible Assets 2 35 37 - - Investments in Joint Ventures 6,395 (6,395) 6,397 37 - - Current assets Stock 4,266 6,474 10,740 3,494 3,161 Debtors 1,180 12 1,192 505 26 Cash at bank 24,792 156 24,948 33,162 682 30,238 6,642 36,880 37,161 3,869 Creditors: amounts due within 1 year (134) (282) (416) (336) (85) Net current assets 30,104 36,825 3,784 Net assets 36,501 36,825 3,784 Represented by: Share Capital 18,135 18,135 2,226 Share Premium account 19,035 19,035 2,017 Profit and loss account (669) (345) (459) Shareholders funds 36,501 36,825 3,784 Bulgarian Property Developments Plc Consolidated Cash Flow Statement for the six months ending 31 December 2006 Unaudited Unaudited 6 month 6 month period Audited period ended year ended ended 31December 30 June 31 December 2006 2006 2005 #'000 #'000 #'000 Net cash outflow from operating activities (2,487) (1,977) (857) Returns on investments and servicing of finance Interest received 495 671 19 Interest paid - - - Net cash inflow from returns on investments and servicing of finance 495 671 19 Acquisitions and disposals Payments to acquire tangible fixed assets (3) - - Investment in Joint Ventures (6,395) - - Net cash outflow from acquisitions and disposals (6,398) - - Net cash outflow before financing (8,390) (1,306) (838) Financing Issue of ordinary shares - 35,000 - Less: issue costs - (2,082) (9) Net Cash inflow/(outflow) from financing - 32,918 (9) (Decrease)/Increase in cash in the period (8,390) 31,612 (847) Cash and cash equivalents at the beginning of the period 33,162 1,550 1,550 Translation differences 20 - (20) Cash and cash equivalents at the end of the period 24,792 33,162 683 Reconciliation of operating loss #'000 #'000 #'000 to net operating cash outflow Operating loss (832) (633) (184) Depreciation 1 - - (Increase) in stocks (772) (1,085) (751) (Increase)/decrease in debtors (675) (439) 40 Increase/(decrease) in creditors (209) 180 38 (2,487) (1,977) (857) Bulgarian Property Developments Plc Notes to the Interim financial Statements for the six months ended 31 December 2006 1. The financial information contained in this document has been prepared in accordance with Generally Accepted Accounting Principles in the United Kingdom and with AIM rules and does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. This interim statement has not been audited but has been reviewed by the Company's auditors, Nexia Smith & Williamson. Statutory accounts for the year ended 30 June 2006 have been filed with the Registrar of Companies. The auditors have reported on those accounts; their report is unqualified and did not contain a statement under either Section 237 (2) or Section 237 (3) of the Companies Act 1985. 2. Comparatives The comparative periods represent audited results for the year ended 30th June 2006 and interim unaudited results for the period ended 31 December 2005. 3. Accounting policies The interim statement has been prepared on the basis of the accounting policies set out in the Group's audited accounts for the year ended 30 June 2006. The main policies are noted below: Basis of Consolidation The consolidated accounts incorporate the accounts of the company and all its subsidiary undertakings. Where subsidiaries are acquired or sold during the year the group profit and loss account includes the results for the part of the year for which they were subsidiaries. All subsidiaries are consolidated using the acquisition method. Joint ventures are included using the gross equity method in accordance with FRS 9. The gross equity method includes, within the consolidated balance sheet, the Group's share of the assets which it jointly controls and its share of the liabilities for which it is jointly responsible. The consolidated profit and loss account includes the Group's share of the income and expenses of the jointly controlled entity. Joint Ventures are those entities over whose activities the Group has joint control, established by contractual agreement and requiring unanimous consent of shareholders for strategic, financial and operating decisions. Stock Stock represents land acquired for resale and is valued at the lower of cost and net realisable value. 4. Loss per ordinary share The loss per ordinary share is based on the losses for the 6 months ended 30 December 2006 of #335,000 and the weighted average number of ordinary shares in issue during the period of 72,540,657 (30 June 2006: loss of #65,000 for the year ended 30 June 2006 and weighted average number of ordinary shares of 38,070,801; 31 December 2005: loss of #165,000 for the six months ended 31 December 2005 and weighted average number of ordinary shares of 8,904,000). The diluted loss per share is identical to that used for basic loss per share as the exercise of options would have the effect of reducing the loss per share and therefore is not dilutive under Financial Reporting Standard 22 "Earnings per Share". 5. Post balance sheet events On 1st February 2007, a wholly owned subsidiary, Bulgarian Property Developments 2 EOOD, completed the purchase of a site of approximately 87,003 square metres (21.5 acres) in Sofia, the capital of Bulgaria, for which contracts were exchanged on 7 July 2006, at a price of Euro 23.5 million. The site is close to Lozenets (an upmarket residential district in Sofia) and is half way between the southern section of the outer ring road and the centre of Sofia. It is adjacent to the proposed inner city ring road and is well located for a business and retail development. 6. Related Party Transactions The company has taken advantage of the exemption in FRS 8 Related Party Transactions in respect of disclosure of transactions with group companies. On 15 September 2004, a management agreement with Bulgarian Property Management LLP Limited, a company controlled by Ivo Hesmondhalgh and Philip Pashov, was entered into by the Company, in consideration for the payment by the company of an annual administration fee and an annual performance fee. These obligations also include the provision of services to fulfil the company's executive functions. These fees represent the executive requirements of the company. The details of this arrangement was fully disclosed both in the admission document when the company was admitted to AIM and in the offer for subscription document dated 15th September 2004. On 27 March 2006, the agreement with Bulgarian Property Management LLP was terminated and a management agreement with Bulgarian Property Management Limited was entered into on the same terms and conditions as the agreement with Bulgarian Property Management LLP. The fees paid in the six months to 31 December 2006 were #323,000. As at 31st December 2006 there were no fees outstanding. Bulgarian Property Developments EOOD entered into agreements in Bulgaria with Galchev and Co, a company 100% owned by Nikolay Galchev and with Building and Construction Group EOOD, which is 40% owned and managed by Galchev and Co. Fees of #3,718 were charged in the six month period to 31st December 2006 relating to these agreements. Independent review report to Bulgarian Property Developments plc Introduction We have been instructed by the company to review the financial information for the six months ended 31 December 2006 which comprises the Chairman's statement, the Consolidated Profit and Loss Account, the Consolidated statement of Total Recognised Gains and Losses, the Consolidated Balance Sheet, the Consolidated Cashflow Statement and the related notes 1 to 6. We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or other material inconsistencies with the financial information. This report is made solely to the Company in accordance with guidance contained in Bulletin 1999/4 'Review of interim financial information' issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our work, for this report, or for the conclusions we have formed. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim report in accordance with the AIM rules of the London Stock Exchange which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of the group management and applying analytical procedures to the financial information and underlying financial data and based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 31 December 2006. Nexia Smith & Williamson 25 Moorgate Chartered Accountants London Registered Auditors EC2R 6AY Date: 21 March 2007 This information is provided by RNS The company news service from the London Stock Exchange END IR SEAFAFSWSEDD
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